Businessman Cyril Ramaphosa, the new leader of the ANC, needs to fix a sluggish economy and a deeply divided society. Market euphoria after his election may not reflect the looming slog, fund managers say.
The outcome, announced late on Monday, was widely expected. The rand has rallied 7 percent against the dollar since Thursday, and government bond yields fell 58 basis points over the same period. Credit default swaps, used to price default risks, are down around 16 bps since end-Thursday.
On Tuesday, shares in South African banks - a barometer of economic and political health - jumped 8 percent.
Ramaphosa, likely to become South Africa's president after the 2019 elections, is considered an improvement on scandal-mired Jacob Zuma. But the good news seems already in the price - a CDS-based model by S&P Capital shows South African foreign debt priced in line with its rating for the first time in 2 1/2 years following the ratings cut in late November .